Evaluation and analysis of substantive and procedural management of dismissals in the department of Justice (specifically master of the North Gauteng High Court, Pretoria)

Evaluation and

Analysis

of

substantive

and

procedural

management of dismissals

in the

Department of Justice

(specifically Master of the North Gauteng High Court, Pretoria)

By

YVONNE MAKHUBEDU

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060042230H

North-West Un1vers1ty Mafikeng Campus Library

Mini-dissertation submitted in partial fulfilment of the requirements for the Master's degree in Business Administration at the

Graduate School of Business and Leadership of the North West University, Mafikeng Campus

Supervisor: Prof. Lubbe Date: November 2012

Declaration

I, Yvonne Makhubedu hereby declare that this research mini-dissertation is my own original work, that all reference sources have been accurately reported and acknowledged, and that this document has not previously, in its entirely or in part, been submitted to any University in order to obtain an academic qualification.

Acknowledgements

I dedicate this mini dissertation to my late mother Paulinah, father Jansen and brother Anias Makhubedu.

I wish to express my sincere gratitude to the following persons:

• My Creator whose blessings gave me the ability and opportunity to complete this study (genesis 12: 1-3)

• My supervisor, Prof Sam Lubbe, for his time and commitment to my success, for his patience and understanding with my never ending list of questions, and for his relevant advice on all aspects of the thesis especially helped me not to give up.

• My husband Meshack who supported me during my thesis, for his unconditional love and support academically and spiritually.

• My classmates, and in particular Daisy for her support, words of encouragement and love.

• My family for their unconditional love, support and patience during my studies, especially my elder sister thandy for believing in me .and my daughters Rega and Samantha (special thanks).

Abstract

After a review of the literature relevant to dismissal management systems been over time and across different government departments, this thesis confines it's relevant to case study of the department and implementation of a dismissal management system in the department of Justice (Master of the High Court). Collection followed for the relevant data by a discussion of the development and implementation of the dismissal management system at the Master of the High Court over period of five years from 1st June 2007 to 31st May 2011. Next, an analysis of major themes that emerged from the research, in terms of important items for consideration in the development and implementation of a dismissal management system in the department of Justice. After analysing the relevant information, it became apparent that the dismissal management system has no direct influence on the delay of the Master of the High Court. Although the department of Justice is dismissal management systems undergoes continual improvement, significant inroads have been made into providing a sensible, clear and dynamic solution to the problem of rewarding efficient and effective dismissal management system in a number of ways.

TABLE OF CONTENT

Declaration

2

Acknowledgements

3

Abstract

4

CHAPTER 1: OVIERVIEW OF THE STUDY 10

1

.

1

Introduction

10

1

.

2

Background of the Problem Statement

13

1.3

Problem Statement

14

1.4

Background and Rationale

15

1.5

Research Objectives

15

1

.

6

Research design

15

1

.

7

Dissertation Layout

16

1

.

8

Conclusion

17

CHAPTER 2: LITERATURE REVIEW 19

2

.

1

Introduction

19

2

.

2

Dismissals

19

2

.

2

.

1

The Historical Contract of Dismissals

21

2.3

Reasons for Dismissals

23

2.4

Dismissal Impacts

25

2

.

5

Markets

27

2

.

6

Definition of Dismissals

28

2

.

7

Bias and Dismissals

29

2

.

8

Problems with Dismissals

31

2

.

9

Criteria for Dismissals

34

2

.

10

Dismissals and Benefits

36

2

.

12

Economic Theory and Dismissals

41

2

.

13

Research Questions

46

2

.

14

Conclusion

46

CHAPTER 3: RESEARCH METHODOLOGY 48

3

.1

Introduction

48

3

.

2

Types of Research

49

3

.

2

.

1

Qualitative and Quantitative Research

49

3.2

.

2

Research Methods

50

3

.

2.3

Primary and Secondary Data

51

3

.

3

Data Method

51

3

.

3

.

1

Methods for Collecting Primary Data

51

3

.

3

.

2

Questionnaires

53

3

.

3

.

3

Sampling Methods

54

3.

3.4

Types of variables

55

3.4

Ethical Construction to the Study

56

3

.

5

Limitations

57

3

.

6

Conclusion

57

CHAPTER 4: DATA COLLECTION 58

4.

1

Introduction

58

4

.

2

Response Rate

58

4.3

Demographics

59

4.4

Measures of association

62

4

.

5

Correlations

66

4.6

Conclusion

68

CHAPTER 5: CONCLUSION AND RECOMMENDATIONS

5.1 Introduction

69

5.2 Summary of the Study 70

5.3 Response to Research Questions 70

5.3.1 Are proper procedures followed in dismissal hearings, or have a

disproportionate number of employees been dismissed unfairly? 70 5.3.2 Are a number of employees been, dismissed unfairly? 71

5.3.3 Are managers who deal with dismissals credible? 71

5.3.4 Do employees and supervisors follow the dismissal from

management system policies and procedures? 72

5.3.5 Do employees consider the dismissal management system fair? 72 5.4 Recommendations

5.5 Conclusion

References

Appendix A: Table of Contents

72

73

76

79

Appendix B: A short disclaimer describing the purpose of the study 86 Appendix C: A reminder regarding research questionnaire collection 87 Appendix D: Questionnaire Appendix E: Matrix Appendix F: Correlations 88 91

99

LIST OF FIGURES

Figure 4.1 Age of Respondents 59

Figure 4.2 Gender of Respondents 60

Figure 4.3 Grew up in SA 60

Figure 4.4 Qualifications of Respondents 61

Figure 4.5 Ethnics of Respondents 61

Figure 4.6 The dismissal process is standard in all aspects 62

Figure 4.7 The proper procedures are followed in dismissal hearings? 62

Figure 4.8 Are a disproportionate number of employees dismissed

unfairly? 63

Figure 4.9 During unfair dismissals do you think the proper procedures

we're not followed? 63

Figure 4.10 Was the manager well trained to handle the hearing? 64

Figure 4.11 Did the manager use the manual during the dismissal? 64

Figure 4.12 Does other staff acknowledge the dismissal handled by specific

managers well? 65

Figure 4.13 Were there any repercussions after a dismissal or were they all

accepted? 65

Figure 4.14 Were there ever deviations of procedures during a hearing? 66

LIST OF TABLES

Table 3.1 Overview of the difference between quantitate and qualitative

Research 50

1.1 Introduction

Chapter 1

Overview of the S

t

udy

The Labour Relations Act defines the meaning of dismissals to be where an employer has terminated a contract of employment with or without notice what is required in the same Act or initiative by the employer to terminate the contract. Dismissal is not a legitimate instrument of coercion in the collectio'n bargaining process under the Labour Relations Act of 1956. Furtado and Ro Zeff (1989) therefore conclude that the evidence for pure dismissals is highly tentative.

Pedman and Lin (2002) concurs that they provide evidence that the subset consisting of pure dismissal enouncements generate lower abnormal returns that combined enouncement of dismissals and successors.

The relative lack of research on employee perceptions on the role of management dismissals is the primary impetus of this study, which advances this important, but neglected research area by investigating potential predictors and consequences of role of management in dismissals.

The aim of the study is to determine employee perceptions on the role of management in dismissals. This chapter begins with introduction, the background of the study, statement of the problem, research aims and objectives, research design, limitation of the study and the significance for the study.

Chapter one of the study outline as follows: The background of the study,

statement of the problem, research aims and objectives, research design, limitation of the study, and the significance for the study.

1.2 Background to the Problem Statement

Management of dismissals is a process aimed at determining the result of an employee's actions, one of its main functions being to discipline and combat employee's wrongful actions. It is frequently seen as one of the hallmarks of the new managerialism in human resource management, also commonly represented as a device for individualising the employment relationship.

It has become an increasing tool to manage and improve the dismissals of

employees, to make more valid decisions and to enhance effectiveness of the

organisation overall performance. Dismissal management systems are among the

most human resource systems in organisations as far as they yield critical

decisions integral to various human resource and outcomes.

Every method of managing dismissals has its positive and negative

characteristics. They all have common characteristics, in such that they are

opinion based generally one sided and are rarely based on metrics. The

employers undertake the dismissal because they belief that it increases discipline

and decreases corruption. The Human Resource Managers' concerns are

improving the ability of managers to manage dismissals.

An organisation's dismissal management system is one of its most important

managerial activities. It seems that there are dislikes with staff members due to

management way of dismissals. The management of dismissals is significant as

every employee need and deserve to know where they stand in the disciplinary

hearings.

Thomas (2007: 1) assets that getting the most from the employer promotes top management of dismissals are one of the biggest challenges for public sector

managers. Ensuring that employees are managed, developed, recognised and

rewarded is a full-time job for the line manager. Managers must communicate well

with dismissal consequences, an environment that encourages and enables the

employees' accountability for results; and differentiate between high and low levels

of dismissals and, equally important managers must be held accountable for these

responsibilities. Similarly, employees need to make sure they clearly understand what will be expected from them and how this relates to the overall organisational

goals; pursue a path of continual learning; regularly communicate with their

supervisor, and hold themselves accountable and responsible for their actions.

In the Republic of South Africa's Public Service Act (1994) the Executing Authority is required to furnish approval as to the persons to be dismissed whenever it is

In order to enable itself to comply with the instruction with regard to the consideration of such person's relative conduct Justice Department formal system of management of dismissals have to comply with Act 103 of 1994. However,

Thomas (2007: 1) argues that many organisations implement dismissal management systems that designed on paper but these same organisations are unsuccessful at making the cultural shifts necessary to make significant change

and results.

The Marco Leonard (2008) concurs that the presence of dismissals costs has an impact on efficiency because dismissal protections raise organisations adjustment costs.

The accuracy of the dismissal management process is important. If the process is inaccurate it is unlikely that employees will buy into the dismissal management system. The effort to improve management of dismissal should lead to greater buy in from managers.

The disagreement between workers and management over the accuracy and

legitimacy of dismissal standards and criteria are extremely common. The disagreement between workers and management over accuracy and legitimacy of dismissal standard and criteria are extremely common (Miller and Thornton, 2006:

53).

1.3

Prob

le

m Statement

According to Susanne Hahn (2009, 465- 477) that although dismissal is a most prominent and urgent problem in the global economic crisis, it is not confirmed to the situation and it is a continuous problem. Jose E (2001) mentions that whenever there is a dismissal, a double moral hazard problem can arise. The

solution to the problem does not necessarily imply the elimination of firing cost. Joanmo (2007) states the legal rule governing unjust dismissal is an important component of Labour Law in any country. It is difficult to compare the scope of

legitimate dismissals in a particular country with that of other countries.

Michael Segalla (2001) states that before, turning to the choices of the respondents; reflect on what criteria considered important to the decision of choosing someone for dismissal.

The subject management dismissal reviews triggers a wide range of complex responses from employees and managers alike. The pain of conducting employee disciplinary hearings reviews seems to rank alongside root canal on the list of things that managers look forward. Presently, there is no current management process subjected of Dilbert lampoons than the management of dismissals.

Scholtes (1993) states that at best management of dismissals do not work, at worst they cause serious damage to the morale within the organisation. Despite the extensive use of management of dismissals most people lack confidence in the process. Furthermore Scholtes contends that management of dismissals concept cannot be fixed, since it is a reflection of leadership philosophy (Rasch, 2004: 411 ). Despite the popularity of management of dismissals as management tools, there is an on-going debate among practitioners, academicians and scholars regarding the true efficacy of management of dismissals (Schraeder, Becton and Portis, 2007: 20).

Roberts (2002: 333) also highlights that dismissals are a controversial management tool searching for answers to ubiquitous problems in system design and administration. Critics of management of dismissals present a number of compelling arguments against its use. Anecdotal, empirical and personal experience demonstrates a multitude of problems with dismissal system practices. The main critiques are that the employee dismissals assumes a false degree of disciplinary hearing accuracy, encourage dysfunctional employee conflict, assigns

I

and inordinate amount of responsibility for poor performance to individual employees while undervaluing the overall work process, underemphasises the importance of the work group.

Ronny Noren's (2004) traditional short-term unemployment policy could amount to unpleasant structures effects on the rate of unemployment. The traditional management of dismissals treats employees as outcasts of the organisation, fails to create a dialogue and rarely results in negative employee development. Furthermore books and articles provides direction on how to put the subject of disciplinary hearings at ease and how to hold difficult conversation but the fundamental flaws in management of dismissals is rarely examined and the books do nothing but underscore the defects in the traditional dismissal management.

According to Scholtes (1998), the range of problems with managing dismissals is because of the fact that dismissal management systems based on a widely held invalid assumption. Many of these false assumptions relate to the process of the disciplinary hearings themselves. Furthermore these assumptions have questionable validity. A review of the literature on management of dismissals find it littered with critisism on the dismissal pro~ess (Law, 2007: 18). Shraeder (2007: 22) asserted that management of dismissals detrimental to organisations if they are not utilised appropriately and if the dismissal management system does not match the culture or system within the organisation, then the system will not be effective.

Jawahar (2007: 736) agrees that perceptions of fairness is important to all human resource processes, e.g. discipline charging and verdict and particularly so, to the dismissal process. Other researchers have also acknowledged the importance of fairness to the success of failure of dismissal systems (Smither, 1988, Taylor et a/, 1995).

There are numerous veto points that can derail even the most carefully designed systems. Furthermore personal bias, unclear dismissal standards, inadequate documentation and absence of coaching and training are few factors that increase dismissals.

The research problem derived from the assumption that management of dismissal systems become subject to biasness and subjectiveness in the disciplinary hearing processes at the Department of Justice. The problem to be investigated is, therefore, to determine why management of dismissals are experienced as being biased and subjective and whether or not the negative feelings that follow relate to the questioning of the appropriateness, effectiveness and efficiency of the dismissal system used.

1.4

Background and Rationale

Turk and Roolaht (2005: 9) state that management of dismissals is a process aimed at determining the results of an employee's actions, one of its main functions being to discipline an employee wrongful actions. Furthermore, they emphasise that a dismissal management criterion has to be relevant, reliable and justly measurable, while also closely linked with the objectives of the organisation

and its subdivisions. Management of dismissals has done little to improve its usefulness as a managerial decision making tool.

The other difficulty is incompetent supervisors that conduct professional disciplinary hearings. Carel et al. (2008: 247) believe that formal training of supervisors is the most effective way to prepare the managers and supervisors to conduct successful employee disciplinary hearings.

The outcome of this study is to make a contribution with regard to the management of dismissal process and the elimination of employee dissatisfaction

at Justice Department. There is a need for the entire organisation, particularly departments in general, to apply management of dismissals objectively.

1.5 Research Objectives

The aim of this study is to demonstrate that the results of management of dismissals, if applied incorrectly, lead to disputes, grievances and complaints of unfair dismissals from the side of employees. Further, recommendations will conduct at the end of the study.

The objectives of the study are to determine

a) the degree of objectivity of management of dismissals;

b) the way in which it is experienced by employees; and

c) the way in which supervisors conduct management of dismissals.

In management of dismissals, supervisors have to make use of rules that deals

and from the basis of the management of dismissal.

1.6

Research Design

According to Mckendrick (2001: 256) research design provides the answers to questions of what the means to obtain information needed. It is the overall plan or strategy by which questions answered by respondents. For the purposes of the study of quantitative measures are applied.

For the quantitative measure, research questionnaires will distribute to respondents. The rationale to use questionnaires is the validation of information that will gather to eradicate any doubt or feeling of bias. The information gathered

through need to be congruent with the questionnaires, to ensure validity and reliability.

The following methods used to collect and analyse relevant data. Namely, a research methodology, which comprises methodological techniques (such as primary sources, secondary sources and group administration), survey techniques; method of data collection, which comprises the use of questionnaire such as data analysis; validity and reliability tests; ethical considerations; demarcation of research, which comprises both time demarcation and numerical demarcation (general purpose, target population and sample); clarification of terminology; and conclusion.

1. 7

Dissertation Layout

Chapter One: This chapter will include this introductory chapter.

Chapter Two: A review of the literature relating to management of dismissals, contextualised at the Department of Justice. This chapter outlines management of dismissals, in terms of definitions, criticism of management of dismissals, role and ethics, mental health and participation, measurement and feedback, employee conflict and competition, accountability and trust, fairness and bias rating satisfaction and dissatisfaction, advantages and disadvantages of management of dismissals as well as the development and communication of management of dismissals.

Chapter Three: The research methodology described. The research paradigm and the research methodology will also be discussed, including the population and sample size. The detailed account of both data collection techniques and data analysis and interpretation will be presented. Issues of the validity and reliability of the study will be detailed. Ethical issues will also be discussed and limitations on the research will be clarified.

Chapter Four: Will provide a detailed chronology of results obtained from the performance appraisal. An analysis of these results in terms of the literature presented and findings discussed.

Chapter Five: A link between the literatures established, in this study, collected

and presented data. It will also contain conclusion and recommendation for further

study.

1

.

8 Conclusion

The problems based on the assumption that management of dismissals systems is

subjective to biasness in the disciplinary hearings. The absence of management of dismissals would have led to highly capable organisations founding themselves in the midst of mediocrity.

The study focused on employee perception on the management of dismissals in the Department of Justice and triggered by low morale on employees when it is time for disciplinary hearings. This chapter has presented information pertaining to management of dismissals. An introductory look on management of dismissals and a brief history of management of dismissals outlined, followed by its background, research problem, research objectives, research design and conclusion.

This study will add to new body of knowledge that will shed light to the Department

of Justice's management on dismissal management. This body will also eradicate a norm where Justice employees are possibly demotivated and demoralised when it is time for disciplinary hearings. The findings of this study will unveil a suitable dismissal management technique and eventually benefit the Department of Justice. The management of dismissal is a tool through which the department could keep employees motivated if it is done properly and contribute to production and service delivery. This may finally lead to an improved economic growth of South Africa and yielding high level of employment.

Chapter Two will contextualise the management of at the criticism of management of dismissals, role and ethics, mental health and participation, measurement and feedback, employee conflict and competition, accountability and trust, fairness and

bias, rating satisfaction and dissatisfaction, advantages and disadvantages of

management of dismissals as well as the development and communication of management of dismissals.

The objective is to emphasise the significance of management of dismissals as it relates to the effectiveness of the organisation and to emphasise the ways in which will affect the development of the organisations employees.

2

.

1 Dismissals

Chapter 2

Literature Review

This chapter provides an outline of management of dismissals, in terms of its historical content, the reasons for dismissals of the people who are impacted and problems encountered because of the mismanagement of dismissals in the Department of Justice.

Meaning of dismissal in terms of the Labour Relations Act dismissal means that: (a) an employer has terminated a contract of employment with or without notice, what is required is some act or initiative by the employer to terminate the employment contract.

In Ouwehand v, Houtbay Fishing Industries it was stated the employee must prove

same overt act by the employer that is the proximate cause of the termination of employment, for instance:

i. Unilateral Act of giving notice by the employer.

ii. The termination of the contract by the employer before the expiry of a fixed term contract.

iii. The voluntary winding of a company.

iv. The termination of the contract by the employer before the employee commences employment.

v. The repudiation of the contract by the employer, for instance because of a demand of a third party and so forth.

2

.

1.1

The historical contract of dismissals

Vestal (2006) state that an employer has a right to dismiss employees, who refuse to accept changes to their terms and conditions of employment. When such changes are necessary for the viability of the employers enterprise and whether there is a link between such a dismissal and that contemplated by Section 187(1) (c), Vestal (2006) first examined the historical background of Section 18(7) (i) (c). Vestal (2006) agreed that Section 187(1) (c) intended to be a way with the concept

of dismissal lock out as encapsulated in the definition of a lock out in terms of the 1956 Labour Relations Act. In terms of the definition of the lock out an employer permitted to dismiss employees as a way of inducing them to accept a demand. However the dismissal has to be conditional and coupled with an offer of re-employment should the employees accept the demands. Such dismissals, for example in ocean fertiliser, were held to be fair dismissals that were final and not also impaired by an offer of re-employment upon acceptance of employer if demand fell outside the ambit of the lock out and were held to be unfair. Such was the case in (commercial catering Allied workers Union v Game Discounty).

In Section 187(1) (c) only seeks to outlaw conditional dismissals that have a purpose of compelling employees to accept a demand in respect of a matter of mutual interest. A dismissal that is on conditional falls outside the scope of Section 187(1) (c).

The Court stressed the following in terms of Section 187(1) (c):

• A final dismissal cannot serve the purpose of compelling the dismissed employees to accept a demand in respect of a matter of mutual interest between employer and employee because, after he has been dismissed finally, no employment relationship remains between the two.

• An employee is acceptance of an employer is demand in respect of a matter of mutual interest can only be useful or worth having if the employee is going to continue in the employers empty.

• An employee who accepts the demand and continues in the employers employ that would serve a useful purpose however, if the employees that are dismissed finally and irrevocably, their agreement that the employer may do away with the transport subsidy is irrelevant. The workers whose agreement matters are those who are going to be in his employ"

• It is therefore clear that according to the Court, Section 187(1 (\) (c) strictly applied to dismissals that are conditional and accompanied by an offer of re-employment upon acceptance of employers demand.

• Dismissals that is final in the sense that they are not accompanied by an offer of re-employment fall outside of the scope of this section.

2.2 Reasons for Dismissals

The results of this study indicate that nationality is a good determinant of the choice of whom to dismiss. Nationalities are more concerned about the social effects of dismissal on the individual and work group. Others are more concerned about the economic benefits or lots to the organisation (Segalla and Parties 2011 ). The issue of the terror of globalisation in other organisations one reads in the business headlines that two thousand employees dismissed were because of this or the merger. Another five thousand will because of a corporate restructuring plan and, may be a further two thousand five hundred because of outsourcing. The process of termination for workers should be in place before employees are hired (Krimarch 2007). This provides a foundation from which to avoid legal problems. Studies document that dismissed employees who did not receive an explanation for their dismissal are 10 times more likely to sue their farmer employer than those who receive a full explanation. Only 0,4% of employees who saw themselves treated with high levels of dignity and respect during the dismissal process filed claims and claims were filed by 14,9% of employees where dismissal process was seen as and undignified.

Typically, European EPL requires firms that fire workers for economic reasons, to compensate them with a severance payment but if firms fire workers for disciplinary reasons, no compensation is payable (Jose, 2011 ). In all cases, firms are required to provide reasons for the dismissal and if these are considered unfair by Court, firms have to pay a higher indemnity (the unfair indemnity).

Work place and work force are important determinants of employment contracts,

management style and the extent of discipline and dismissal (Knight and Laetrile,

2000).

The rest theoretical literature on EPL does not take into account that legal restrictions to dismissals effect both economic and disciplinary dismissals (Boeri, 2004). The legal rule governing unjust dismissal is an important component of labour law in any country. To compare the scope of legitimate dismissals in a particular country is difficult because comparative studies on labour law require proper knowledge of historical background and socio-economic factors while the federal rules of civil procedure are trans-substantive, their impact, is not the impact

of the rules on the outcome of civil litigation, depends on the sustentative claim at issue. Specifically the confluence of Rule 8(a) (2) is pleading requirements and Rule 12(b) (6) is dismissal criteria as recently interpreted by the Supreme Court in Bellatlantic (Joonmocho, 2007).

Related to distributive justice is procedural justice, which is upheld when the process for making a decision is transparent and unbiased (Southey, 201 0) this study focus on the impact of a status discipline system on its use and rapidity of discharge of state employees. Results show that factors associated with utilisation of dismissal of state employees differ from factors associated with how quickly state terminates employees. This study shows that state adopting at will employment are no more likely to fine employees than states with civil service employment. Systems are, but they do terminate employment relationships more quickly (Selden, 2006) when establishing the effects of the charge in the paper regulations on small establishments hiring and firing behaviour. The major concern is that unobserved heterogeneity might bias the results. (Bauernschuster, 2009) yet the problem of biased estimates can be tackled if repeated cross Section data are available for the treatment as well as an appropriate control group that covers as post treatment periods. In that case, difference in differences technique applied, allowing for time in variant unobserved treat erogeneity.

Although the descriptive cross tables give impressions of the effects of the change in Germany, one should interpret it with caution. To be able to make rigorous statements about the impact of the relaxed dismissal protection regulations on the hiring and firing behaviour of small establishments, the effects are now analysed in a multi variety setting.

In 2006 employment report, the European Commission appealed to the strategy of flexicurity and announced four components of flexicurity such as:

1. Flexible and reliable contractual arrangements. 2. Comprehensive lifelong learning statements. 3. Effective active labour market policies and 4. Sustainable Social Protection System.

Schmid, (2006) Kaufman begins his historical narrative in chapter 3 by reviewing the labour problem at the turn of the century, which consumed national debate and led companies to experiment with new approaches no tame labour (Rosemary Batt, April 201 0).

The significant impact of investment analyst's ratings and reports on the demand for and the valuation of a firm, stock that analysts represent an important external control mechanism that serves to monitor agreement (Wiersema, 2008).

Previous empirical studies of wrongful dismissal cases have not considered the impact of the Supreme Court of Canada decision in Wallace v United Grain (Wagar, 2009).

2.3 Who is impacted upo

n by dismissals?

A recent survey of over seventeen thousand households in Europe by Eunobarometer suggests that the answer to who will go is clearly the youngest and oldest employees. Middle-aged employees appear to be less unemployed than the other two groups (Segalla, Hec, Pans, 2001 ).

Most employers believe it is safest to say as little as possible and do not go into detail with a fired employees prospective employers (Buppert, 2008). Many employers refuse to reveal anything other than the former employee's title and dates of employment.

In order to encourage managers to pursue goals consistent with the maximisation of shareholder wealth, many firms employ mechanisms designed to keep managers interest aligned with those or shareholders (Iqbal, 2007).

Your boss wants to speak to you. You are fired, why? You may suspect a

personality conflict with the boss or maybe you feel that the company wants to replace you with a recent college graduate at half your pay or may be even with the boss's brother in law but you know your job performance and attendance are not the cause. It does not matter you are fired. No reason or warning, that is the Law (Saltzman, 2008).

Through dismissal is a most prominent and urgent problem in the current global economic crisis, it is not confirmed to this situation (Hahn, 2009). It is a continuous problem, re-organisation of companies, the relocation of production

abroad, the termination of production or whole industries, mergers and acquisition, new strategic decisions all mangers accompanied by dismissals.

The presence of dismissal costs has an impact on efficiency because dismissal protections raise firm's adjustment costs. Firms will distort their production, choices, substituting capital for labour, retaining unproductive workers whose wage exceeds their productivity and not hiring workers whose wage lies below their productivity (Leonardi, 2008).

Lucas, (2004) argue that the legislation has not been effective in controlling managerial power in the case of dismissals. Building on the basic principle according to which labour market institutions have a substantial impact on the

labour market performance, in the recent years economists begun to pay special

attention to the relationship between the employment performance of a given economy and strictness of its employment protection legislation (Besencenot, 2008).

Workers are entitled to receive a severance payment and when dismissed, due to operational reasons, dismissed due to disciplinary reasons, workers miss out. This gives the incentive for firms to claim the dismissal has taken place due to shirking, even though it has been due to a productivity shock (Stahler, 2007). The vast theoretical literature on EPL does not take into account that legal restrictions to dismissals affect both economic and disciplinary dismissals (Boerie, 2005). In an economy with those erogenous workers, the self-selection of workers into different sectors of the economy plays an important role in explaining the economic outcomes observed in different sectors of the economy (Oemiralp, 2010).

Various aspects in legislating dismissal law cause the trend in increased unjust dismissal. Firstly, the disorderly process of law making may result in design failure in the vague standards that fail to establish clearly the scope of legitimate dismissals (Joonmo, 2007). In view of the above, a better understanding of multiculturalism and its impact on organisations is important for a number of reasons (Stone, 2007).

A large body of academic research examines the causes and consequences of

Coeburn over in publicly traded corporations. This research examines the factors

that lead to the removal of a firm's top executive and identifies how these factors

vary across different types of firms (Fee, 2001 ). However, note that the

mechanism indicates a direct drawback of managerial turnover as the new

manager has less information on the subordinate's abilities, initially his task

assignment decisions will be worse in expected terms than the old managers.

Both effects, the increase of effort and the reduction of the quality of the task,

assignment are two sides of the same than can cause the loss of information

implied by managerial turnover the optimal dismissal decision trades off these two

effects (Haffler, 2003).

This study focuses on the impact of a state's discipline system on its use and

rapidity of discharge of state employees. Results show that factors associated with

utilisation of dismissal of state employees differ from factors associated with how

quickly states terminate employees.

This study shows that states adopting at will employment are no more likely to fire

employees than states with Civil service employment systems are but they do

terminate employment relationships more quickly (Selden, 2006).

2

.

4 Markets

A second reason attributed to the pressures of globalisation, is the development of

global product markets (Jacobs-Belschak, 2001 ). The scenario further offer

distinct choices and dialogue among the four fictional managers discussing their

own preferences.

It is fair to note that most studies of organisational or managerial problems have

been primarily ethnocentric and often North American in their conception and

execution. One of the common problems included making work force adjustments

after managers or in response to increase competition. The typical situation

identified during the interviews often had these elements.

Before turning to the choices of the respondents, reflect on what criteria

considered important to the decision of choosing someone for dismissal. Normal

market preference is for an employee that costs the least, is trainable and

resources because of a manager, major financial loss or simply to improve its competitiveness it may find it cost effective to get rid of some of its less productive resources. The warning triangles represent the group of employees who still provide some benefit to the firm but perhaps are more marginal.

Among researchers focusing on international business three dominant streams for research, appear on a basis for understanding and explaining the values and practices of companies. Further people disagree that organisations are essentially culture free (Hammers and Hickson, 1979).

The choices made by the respondents clearly indicate that European managers do not always agree but should agree on dismissing workers in the downsizing process. Although the choices are different, perhaps the reasons for them dictated by the national socio-economic initiations as suggested above. For example, are there labour laws or union contracts opening the decisions of the respondents? To study this question the written responses were examined to determine what criteria respondents used to make their decisions.

The top ten reasons aggregated at the European and country levels for dismissal presented only two justifications consistently noted within the top five reasons of each country. The first takes advantage of the existence of early retirement programs that is commonly implemented in many countries and industrial sectors. In view of the above, a better understanding of multiculturalism and its impact on organisations is important for a number reasons (Stone, 2007).

Traditional short-term unemployment policy could camouflage unpleasant structures effects on the rate of unemployment such as low capacity rate (Nonen, 2004). This has for a long time been the problem in the Swedish economy. A natural question in this situation concerns the elaboration of an economic policy necessary to increase the capacity and the adaptability to meet the demand of structural change.

Whereas the rate of industrial transformation in the Swedish economy in general restricted by a failure to absorb labour in expanding sectors, the transformation process has prevented the unresponsiveness of the stagnating sectors to release labour. This we must ask to what extent has the labour market restricted the expansive parts of the industry? Obviously the lack of transformation in the labour

market, not only effect but also to great extent determine the conditions for the whole industry.

Structural change in the economy is essential to expect progress. If labour market

policies are devoted mainly to resisting change that will mean slower growth for

the whole economy, that potential conflict between the need for efficient

transformation policy on one hand and diametric labour market policy interest on

the other, remind us about the discussion of long and short policy measures.

Research on disinvestment and how this variable responds of changes of other

variables of the economy and disinvestment activities can be influenced by

economic policy, its important knowledge to find new and more efficient policy

rules with this knowledge the labour markets in several advanced countries would be more flexible and the results would be also better performing.

The concept of transitional labour market aims at providing a consistent framework to give flexicurity a clear direction. The first step of such a framework is to clear the meaning of flexicurity from analytical point of view.

2.5 Def

i

nitions of Dismissals

Susanna Hahn (2009, pp 465 - 477) note that the reorganisation of companies,

the relocation of production or whole industries, mergers and acquisitions, new

strategic direction - all these measures are often accompanied by dismissals.

Koeniger (2004) state that labour dismissals costs are an important exist cost for

firms. For, example the regulation on dismissals costs imposes notification

periods.

The behaviours that lead to dismissal normally occur over a long period patient termination, discharging a patient, patient firing or terminating the provider -patient relationship all terms that define the end of a provider- -patient relationship

(Eastek, 2007)

Lisa (year unknown) state that over the last eight years, the number of auditor resignations and client dismissals has grown significantly and the trend picked up the pattern in dismissals of Big Four Firm by SEC registrants can be attributed in part of rising Big Four audit fees in the make of sox.

Dedman and Lin (2002) mentions that one must provide evidence that the sub set consisting of pure dismissal announcements generate lower abnormal returns than combined announcements of dismissals and successors.

Iqbal (2006) argue that two of these mechanisms are management equity ownership in the firm and the threat of dismissal for poor performance, while these two mechanisms are independent. It is possible that management ownership could reach a point where managers have sufficient average to entrench themselves and reduce the probability for their dismissals. Grant (2009) some code definitions allowed in this way to evolve so that the final code definition better reflected the date

2.6

Bias and Dismissals

Segalla (2009) state that the personal bases of the EMDM project principle designers, Roberts (1970), in her influential paper on culture and management studies notes that one of its main limitations is that the kinds of questions covered and the methodological strategies employed are largely determined by the author's biases. Researchers have examined common organisational problems from a theoretical perspective in one context or another.

Buppert (2009) the employer can say anything that is factually true or a legitimately held opinion the employer can say he or she was not satisfied with the NP's work or that the NP had an abrupt manner with patients, if that is his or her opinion. Most employers believe it is safest to say as little as possible and not go into detail with a fired employee's prospective employers.

An NP faced with the prospect of an unfavourable reference might want to reveal to a prospective employer that he or she left the last position on bad terms with an individual in the position of providing references and explain.

Reilly (2011) states that literature emphasises stereotyping through such implicit associations and Payne (2006) highlight the finding, using laboratory experimental evidence on the "weapon bias" theme that an individual's propensity to implicitly stereotype increases with the need to make vapid or split second decisions.

Cingano, Leonardi, Messina and Pica (2008) states that the goal of the analysis is to establish whether it is positive, in which case the judge would be biased in favour of workers by worse labour.

Besancenot (2009, pp. 262 - 271) argue that their analysis builds on an original hypothesis of impartial justice, according to which, under imperfect information, the equilibrium probability that the judge gives a verdict favourable to the worker should match the frequency of good workers in the population of suing workers.

For sure, any more sophisticated models should fulfil this orientation, or else justice appears bias in favour of either workers or firms.

Aragon-Correa (2006) mentions that to reduce possible social desirability bias,

o promised that analyses can aggregate and no organisation would be identified individually,

o randomly compared self-evaluation of managers with the evaluations of environmental practices of their firms by competitors,

o questions should include specific actions and strategies rather than about general ethnical claims (Banerjee, 2001 ).

Southey (201 0) states that related to c;Jistributive justice are procedural justice,

when the process for making a decision is transparent and unbiased.

Bauernschuster (2009) states that when estimating the effects of the change in the PADA regulations on small establishments hiring and firing behaviour, the major concern is that unobserved heterogeneity might bias the results.

Wagar (2009), comments on procedural justice, the employer failed to apply principles of procedural justice before the termination, the variable includes the employer is failing to investigate thoroughly before termination, to provide an explanation, to provide an unbiased hearing and to allow an appeal of the decision.

2

.

7 Problems

Segalla, (2001, pp. 58 - 72) mentions that one of the common problems included making work force adjustments after mergers or in response to increased competition. The typical situation identified during the interviews often had these elements. According to Davies (2007, pp. 28 - 30) when commenting on legal

issues he mentions that the process for termination should be laid out even before

employees are hired. This provides a foundation from which to avoid legal

problems.

Eastek (2007) states that it is important that nurse practitioners consider the risks and consequences of patient termination. At the same point, every provider deals

with the question of whether and how to dismiss a problem of patient from his or her practice. One week after his appointment, the patient telephone to request a refill of his pain medication, a pharmacist phones to inform the NP that another physician had provided the medication one week earlier. The pharmacist did not

to fill the prescription.

Reilly (201 0) argue that the motivation for use of the letter treats the source of the

problem as individual heterogeneity rather than as attributable to a difference in the regime determining the Zeros and the counts. In order to address the problem of excess Zeros, a zero inflated. A position estimates within a fixed effect.

Hahn (2009, pp. 465 - 477) mentions that though dismissal is a most prominent and urgent problem in the current global economic crisis, it is not confirmed to the situation. In fact, it is a continuous problem.

Jose E (2001) mentions that whenever there is a dismissal, a double moral hazard problem can arise. However, the solution to the problem does not necessarily imply the elimination of firing costs. They derive a pareto-efficient EPL system in

which the gap between the legislated severance payment for those dismissals

considered fair and unfair is a relevant feature.

Stahler (2008) argue that the problem is analysed in a matching model to be able to model operational dismissals and the decision of job creation endogenously.

Noren (2004) argue that traditional short-term unemployment policy could camouflage unpleasant structural effects on the unemployment e.g. to low capacity rate. This is an on-going problem in the Swedish economy.

Southey (201 0) mentions that there were incidences where the employee could not account for their misbehaviour, other to amount the defence that it was out of character behaviour, for example, "his actions were out of character- all the giving evidence indicated they had worked without problems.

Selden (2006) mentions that unexpectedly, the finding indicated that in states with authority centralised in the state personnel office, employees terminated more rapidly for behavioural problems and table 3 presents the results of the regression model estimated for the time to terminate employees for performance problems. The independent variables account for 78% of the variation in termination time for performance problems. Bauernschuster, (2009) mentions that yet the problem of biased estimated can be tackled if rejected cross-section data are available for the treatment as well as an appropriate control group that covers pre- as well as post treatment periods. Batt (201 0) mentions that the labour problem at the return of the century debating led companies with new approaches to tame labour.

Wagar (2009) state that progressive discipline is an intermediate response to an employee's performance is based on the principle of proportionally (McKinley

(2001) the Supreme Court of Canada asserted that the employer should balance

the discipline imposed on the employee with the severity of the misconduct. The Court considers the employers requirement to respond proportionately to employee performance problems and other misconduct to be an important principle in the light of the employers vulnerable position relative to the employer and the valued placed on employment by individuals and by Canadian society. In many of the cases, the Court would have supported a lesser form of discipline rather than harsher discipline of dismissal.

2.8 Criteria

Segalla (2009) states that before turning to the choices of the respondents lets reflect on what criteria might be considered important to the decision of choosing someone for dismissal. Upon examining table 2 it is clear that human sentiment is largely absent among the information provided to the respondents.

Cools (2007 pp. 721 - 742) states that the second legal regime, the weaker form of the structure regime, can be used on a voluntary basis by Dutch Multinational Companies that meet the criteria for the "structure regime" but have more than 50% of their employees working outside the Netherlands. Under this regime, the management board is appointed by the annual meeting of shareholders. The supervisory board retains most of the legal power and shareholders have a limited say.

Saltzman (2006) mentions that a 1964 arbitration ruling set forth seven tests.

Asserting that an employer has a just cause for discharge only if the answer to each question is yes and many arbitrators have adopted tests 1, 2, 6 and 7 but view tests 3, 4 and 5 as unduly restrictive.

The seven tests are:

1. Did the employer give fore warning or fore knowledge of the possible or probable disciplinary consequences of the employee conduct to the employee? 2. Was the employer's rule or managerial order reasonably related to the orderly,

efficient and safe operation of the company's business?

3. Did the employer, before administering discipline to an employee, make an effort

4. To discover whether the employee violated or disobeyed a rule or order of management?

5. Was the employer's investigation conducted fairly and objectively?

6. At the investigation did the "judge" obtain substantial evidence or proof that the

employee was guilty as charged?

7. Has the employer applied its rules, orders and penalties even handily and without discrimination to all employees?

8. Was the degree of discipline administered by the employer reasonably related to (a) the seriousness of the employee's proven offence and (b) the record of the employee's service?

Hahn (2009 pp. 465- 477) state that a mixture of criteria incorporating has proved that the criteria will raise the acceptance by the employees probability for this development as the mentioned established rules are those which are proved and criteria will raise the acceptance by the employees the probability for this development. The discussion of the other rules George considers may provide

further candidates.

The rule to except those employees from dismissal who work most efficiently can also conflict, with the existing rules e.g. the rewarding of loyalty and the esteem for essential abilities. As with the seniority rule, one may consider a mixture that

contains the efficiency criterion. Assessing the consequences of the efficiency rule alone, one can initially expect an incentive for all the remaining employees to

engage in their job.

One has to account, though, for findings on the 13 players; there are colleagues who do their job reliably and with a long-term perspective but do not struggle to ascend to higher ranks as they, for different reasons, are content with their job and

prefer stability and continuity to going in for a career. These employees could be upset by the enforcement of an efficiency rule alone, uncertainty does not

motivate, besides these employees will even totally look for another company e.g.

a small or medium sized business that offers jobs possibly less lucrative but with more stability. These possible consequences again suggest the incorporation of

several criteria into the rule of dismissal.

Head (2004) mentions that on a more general note, it has been argued that the legislation has not been effective in controlling managerial power in the case of dismissals (Collins 1982) and may even be perceived as legitimating managerial control. This is in part due to the interpretation of the legislation by judges, who seem reluctant to intervene in the employment relationship. The Court does not have their own standard of fairness but instead tend to endorse the ordinary practice of employers.

Denham (1993) contends that this serves to support the managerial prerogative for instance, the band of reasonableness test examines what a reasonable

employer would have done and not what the tribunal; this can merely reflect managerial attitudes and may not result in a fair decision.

Cho (2007 pp. 409 - 422) states that it is also suggested that Korean Courts have

traditionally used tenure, age and number of family members as important criteria for establishing justness of dismissal.

Malveaux (2010) the Supreme Court's recent interpretation of Rule 8(9)(2) is

pleading requirement and Rule 12( 1 )(6) is dismissal criteria in Bell Atlantic v

Twombly and Ashcroft v Iqbal set forth a plausibility pleading standard which makes it more difficult for potentially civil rights claims alleging intentional

discrimination to survive dismissal. In the case of McDonnell Douglas the Court state that an employment discrimination complaint like all complaints need only

meet Rule 8's criteria of containing a short and plain statement of the claim,

showing the plaintiff entitled of relief.

2.9 Dismissals and Benefits

Segall a (2001) state that the warning triangles represent the group of employees who still provable some benefit of the firm but perhaps are more marginal. It would probably be too disruptive on the recruitment, training and social system to dismiss them if the organisation is rich enough to continue to pay them.

Vestal (2006) mentions that some of the lessons learned have come many years after the fact, perhaps some wisdom that comes from experiences can be useful to others. Been removed from one job where the person is not successful does not mean she cannot be extremely successful in another role. You may be doing her a favour by enabling her to succeed somewhere else. This situation has determined that it is not a case of a work group collectively undermining the person, it is important to move quickly to rectify the situation. In the case of bad fit or lack of ability to be successful nothing will be cured by time, in fact failure to

take timely action will worsen the situation for everyone.

Have a frank and honest conversation with the individual and talk through the

options. If you truly feel that leaving ttie individual in place will only prolong the inevitable, do not offer that option. Most of the people will opt to work on a bad situation in the hopes that they can turn the tide, while in reality it only delays a necessary decision. Find a way to create a transition that maintains the person's dignity and hope so she can move on to other opportunities. This usually means that you take a discussion, take decisive action, provide a transition plan and move forward. The transition plan will vary depending on the role, the person's longevity in the organisation. If the person must leave the organisation because there are no other opportunities, you may want to provide outplacement counselling and some limited financial support. If the person will transit internally, create a positive message, support for the new role and follow up to ensure success.

For instance, when a worker must be dismissed on grounds of the inability to get along with other staff members due of lack of knowledge or skills, the worker should be referred to a coach or a counsellor. If the situation feels like it is a bad

thing happening to a good person, take the time to think through your own feelings on firing this to find people who have expensed hang fired who will tell that it was a defining event for them that moved them forward to other things for which they were better suited. In different cases, workers will be grateful that you made the decision that they could not make themselves. Sometimes individuals lose their job because of other changes in the organisation such as new leadership that

wants a new team.

Buppert (2009) as for benefits, expect them to end as of the date of fining and 15 days for unused vacation, unless the NP has contract that states that the terminated HP is entitled to payment for unused vacation, there may be no right to that benefit.

Iqbal (2007 pp. 298 - 312) states that we can conclude that continuing managers accumulate additional equity in the company during a period leading up to the dismissal of a member of the management team while replaced managers do not accumulate shares prior to their replacement. This evidence represents additional verification of the manager entrenchments hypothesis.

Hahn (2009 pp. 465 - 477) states that if one assumes these empirical relations, one will argue that the company would benefit from this rule but it might also happen that the enforcement and application of this rule have very negative emotions and judgements.

Stahler (2008 - pp. 1162 - 1178) states that for theoretical researchers, the assignment is to investigate the origin of those mistakes and to examine the cost/benefit analysis to see if the costs to reduce these mistake can be compensated by the benefits of law unemployment rate. Nortan (2006 p3) argue that alignment produces dramatic benefits and consider alignment as a necessary condition for organisational effectiveness.

Wagar (2009) when dealing with factors coded in the content analysis mentions a wearable not serious and below it states the following: the employer failed to consider that the poor performance was not so serious as to repudiate the employment contract. This occurred where the employee had shown no intent to perform poorly, to benefit from the failure to meet standards, or to repudiate the contract in any way.

2.10

Social Principles

Segall a (2001) mentions that a concept called social justice has become a broad

area of research that can a set of social principles used to resolve conflict. Davies

(2007) state that when dealing with emotional and psychological issues, Demisted

most common mistake is impulsively, without documentation of the unacceptable

behaviour before taking action. If no national basis is provided, other employees

may fear being dismissed as well. It is necessary to briefly inform the remaining

employees immediately after dismissing the employee so roomers are stopped

before they start.

Buppert (2007) mentions that she has written about restrictive covenants also called non-compete clauses, in nurse practitioner employment contacts many times restrictive. Covenant is a clause in which an employee promises an employer that he or she will not practice in the same speciality as the employer,

within a set number of miles from an employer's business. Sometimes the clause

requires an NP to promise not to practice at all for a set period after the employee

leaves the employer's business.

In the event of any termination of employee's employment, whether by termination

of employment of this agreement by employer or employee or by explanation of the term of this agreement, employee both while employed by employer and for 2

years after the expiration or termination of this agreement, will refrain. From

soliciting patients treated by employee or any other employee both while employed

by employer and for 2 years after the expiration or termination of this agreement,

will refrain. From soliciting patients treated by employee or any other employee or

employer during the period of employee's employment.

Remedies employee further recognises and acknowledges that a breach of the

foregoing non-competition covenants may cause irreparable harm to employer and

that the monetary damages caused by a breach of such covenants are not

ascertainable. An employee therefore agrees that equitable remedies, including an

injunction are appropriate and the employee hereby consents to injective relief.

Eastek (2007) argue that when considering patient termination, it is important to

consider the ethics of patient termination. Ethical principles provide guidance and

by a single principle. There are many principles but beneficence, no malfeasance

and veracity are most often used for decision making. These principles do not

answer all encountered problems, although they lead us in an evolving set of

standards put forth by society. Jackson (date unknown) note that audit firms

acknowledged their potential liability's and sort out to protect themselves with

malpractice insurance. Nevertheless, the economist reports that insurance firms

are refusing to cover auditors for much, or are charging prohibitively expensive

premiums.

Lawsuits against CPA firms estimate to have increased, with many asserting

conflict of interest and poor audit quality. As the economy's law, more businesses

are likely to fail. In the past, the number and size of lawsuit settlements have risen

as the economy declined

Cools (2007 pp. 721 - 7 42) mentions that all average abnormal returns are

insignificant during event windows d

=

1 and in the ten day period previous to

announcement, indicating that there is no leakage of top executive dismissal

decisions. In addition, extending the d

=

0 window with one extra day, capturing

possible lagged effects, does not influence the effect as is expected in an efficient capital market.

Saltzman (2007) stated that managers have legitimate concerns too. They may

impose discipline to rehabilitate a potentially satisfactory employee, to deter

employees from breaking employer rules in the future or protect profitability or

academic quality in the case of higher education, managers can eliminate

positions to stay within their budgets and relocate resources from low priority to

high priority uses. The employer lacked just cause to dismiss an employee.

Arbitrators differ radically on the issue of whether a failure to accord a complete

and fair investigation and hearing prior to the arbitration requires an individuation

of discipline under the just cause standard the significance of the claim of

procedural deficiency against the harm done to the interests of the grievant by the

omission.

Stahler (2007) stated that in the present paper we will do two things, first we